Breakthrough Cryptos: The Next Bitcoin?

While the big cryptocurrencies have become household names, multiple smaller players are tipped to become the next crypto king.

Below the top ten crypto tokens, these currencies may be about to make their mark on the volatile digital currency market.

Avalanche (AVAX)

Avalanche, with the AVAX native token, is a blockchain network that uses three separate blockchains rather than one, allowing it to scale faster than normal.

Each chain performs a specific task, allowing the network to manage up to 50,000 transactions a second. DApp developers are beginning to choose Avalanche in favour of Ethereum, which charges higher fees.

Traders and developers use AVAX to pay fees and to stake. Users who stake AVAX to become network validators earn up to 10 per cent APY, which is higher than throughout the conventional banking system.

While AVAX token values have dropped from last year, it has ongoing potential backed by Polychain Capital and Three Arrows Capital.

  • Avalanche market cap: £6.7 billion
  • Today’s token value: £23.34
  • Peak token price: £120.52
  • Circulating supply: 289.4 million tokens – 40 per cent of availability

Lucky Block (LBLOCK)

Lucky Block is a crypto gaming network that launched its first NFT prize draw in May 2022. The games platform intends to disrupt the global industry with play-to-earn games and competitions.

The Web 3.0 decentralised platform selects verified winners randomly, and network users can vote on charitable donations, with transactions posted openly on the Binance Smart Chain.

Token holders receive LBLOCK distributions for holding tokens and logging into the app, with around 10 per cent of each distribution shared between token holders looking for passive income opportunities.

Transaction fees are charged at 12 per cent on sales, designed to encourage token holders to view them as a long-term investment.

  • Today’s token value: £0.001
  • Peak token price: £0.01

The Sandbox (SAND)

The Sandbox is a metaverse project that monetises gaming activities through NFTs and the SAND native token.

There are several popular brands within the virtual world, such as Gucci, Adidas, Atari, Samsung and PWC, and the network has confirmed that it will launch further play to earn games.

Crypto investors opt for SAND tokens as a secondary income stream or use the network to play online games or flip NFTs, with integrated technologies for either activity.

The concept is that players can buy real estate with tokens, assign NFTs to games, or trade on the Sandbox marketplace.

One anonymous buyer recently bought a patch of land next to Snoop Dogg’s virtual Sandbox home, paying $450,000 (£371,000).

Metaverse investment is tipped to be a profitable activity, particularly with Meta, the owner of Facebook, investing heavily in this area for socialisation, shopping and working.

  • The Sandbox market cap: £1.4 billion
  • Today’s token value: £1.07
  • Peak token price: £5.57
  • Circulating supply: 1.3 billion

ApeCoin (APE)

ApeCoin is an ERC-20 token linked to the highly valued Bored Ape Yacht Club NFT. APE tokens are not directly involved with the BAYC but are associated with the NFT asset base.

This new cryptocurrency launched in March 2022 and was one of the few coins that rallied in a downward market trend and reached new peak values.

The support from celebrities and cryptocurrency influencers has helped generate buzz, with a number of high-profile individuals promoting ApeCoin.

ApeCoin developers have also launched the Otherwise metaverse project, which uses the APE native token, with further usability upgrades expected in the near future.

  • ApeCoin market cap: £1.7 billion
  • Today’s token value: £5.58
  • Peak token price: £22.67
  • Circulating supply: 306.9 million

Polygon (MATIC)

Polygon is a layer-2 token that provides scaling functionality for the Ethereum network. It is considered to have potential because it is currently underutilised, and several brands have expressed that they are considering building on the Polygon platform.

The Polygon network runs alongside Ethereum, with lower fees and faster processing times, allowing users to bridge crypto to Polygon and use it across a range of crypto apps.

MATIC is the Polygon token used to pay governance and staking fees and is traded on exchanges such as Coinbase.

Crypto applications, including The Sandbox, Uniswap and OpenSea, are hosted on the network, with Adidas indicating that it may enter the crypto verse through Polygon.

Venture capitalists focused on crypto have also been interested in Polygon, such as Tiger Global and Sequoia Capital.

The vision is that the network will become a crypto version of Amazon because it provides a multi-chain scaling opportunity across Ethereum services and other compatible blockchains.

  • Polygon market cap: £6 billion
  • Today’s token value: £0.76
  • Peak token price: £2.41
  • Circulating supply: 8 billion – 80 per cent of availability

Dash (DASH)

Dash, short for digital cash, is in its third incarnation, having launched as Xcoin in 2014 and changing to DarkCoin before becoming Dash in 2015.

This native currency of a Bitcoin fork has been imitated several times and was designed to outperform slow transactions on Bitcoin.

The two-tied master node infrastructure provides enhanced user privacy and was the token of choice when the native currency, the bolivar, collapsed in Venezuela.

DASH coins power the point of sale DashApp, a popular in-store payment option for many US retailers. Users can pay for a range of products and services with DASH, such as phone bills and airline tickets, as well as transfer cash to friends or family.

There are currently over 159,000 US merchants who accept Dash as a payment currency.

  • Dash market cap: £488.8 million
  • Today’s token value: £45.08
  • Peak token price: £1,355.86
  • Circulating supply: 10.9 million

Curve (CRV)

Curve is a decentralised exchange that has grown quickly within the DeFi market, originally focused on leveraging stablecoin liquidity to provide more reliable financing for crypto loans.

The platform has expanded to allow all coins with a pegged value to be traded and offers 122 liquidity pools for currency pairs that users can exchange in the DEX.

Trading fees are low, slippage is limited due to fast transaction speeds, and liquidity is high, which has attracted investment from Crowdcube, Outward VC and Fuel Centre Capital.

The exchange is powered by Curve DAO (CRV), an Ethereum token that traders can swap between other ERC-20 tokens, particularly stablecoins and Bitcoin tokens based on Ethereum.

  • Curve market cap: £590.5 million
  • Today’s token value: £1.12
  • Peak token price: £49.95
  • Circulating supply: 526.1 million

How To Pick An Up And Coming Cryptocurrency

There is no certain way to predict which promising cryptos will take off and which will perform with underwhelming success.

Indicators that may signify a newer or lower-valued cryptocurrency is a viable investment product, or diversification tool include:

  • Sustainable blockchains: crypto tokens should be backed by a reliable blockchain with an identified purpose to solve real or blockchain-related problems.
  • Pricing performance: crypto commonly bounces between highs and lows, but traders will look for resilience, quick rebounds after a crash and sustained growth.
  • Network developments: high levels of developer activity can signify the potential for greater collaborations with on-chain or off-network brands.
  • Adoption: plans for wider adoption of a token, or the underlying blockchain, are a positive sign that the token will roll out in a bigger way.

The caveat is that traders cannot say with confidence that one token will improve profitability and portfolio value. Still, they will look for positive signs that a cryptocurrency has a bright future ahead.

Many early-stage cryptocurrencies are still in development, but new features, collaborations or technologies indicate a greater likelihood of the potential to make value gains.

Breakthrough Cryptos: The Next Bitcoin FAQ

Why is it difficult to predict breakthrough cryptocurrencies?

Crypto assets vary from conventional stocks and shares because the values are primarily speculative, and there usually isn’t any direct link with a company, product or service.

Investing in a cryptocurrency can be a subjective decision-making process because even the most experienced investors cannot be certain of its future value, and its market price can soar or dive on the basis of something as simple as a tweet from a celebrity.

Are cryptocurrency profits taxable?

In most tax jurisdictions, crypto coins are treated as capital assets. Profits achieved on the sale of crypto are normally taxed as capital gains.

How do you buy a new crypto coin?

Most traders will purchase cryptocurrencies through one of the big exchanges, depending on their location, such as Coinbase, Kraken, Gemini or Binance.

What is a cryptocurrency ETF?

Crypto ETFs are a relatively new development and started to appear towards the end of 2021.

Like a standard ETF, the fund tracks the performance of one or more cryptocurrency tokens as a potential route to minimise risk.

Why are there so many new cryptocurrencies?

New cryptocurrencies are always being released as blockchain technology evolves, and developers see new opportunities to create different functions, resolve problems, or offer new services.

No one has control over blockchain technology, so any developer with the skills and knowledge can create their own virtual currency, whether a coin used in place of fiat currency or a utility token that performs a particular task or forms part of blockchain infrastructure.